Climate Fund Managers And Erco Energía, Backed By The EU, Launch First Solar Plant In Northern Colombia And Begin Work On A Second

Climate Fund Managers (CFM), a blended finance investment manager focused on climate projects in emerging markets, and Erco Energía, a leading renewable energy developer in Colombia, have announced two major clean-energy developments in northern Colombia. With support from the European Union, the partners inaugurated the Pétalo del Norte I solar power plant and confirmed development funding for the Pradera solar-plus-storage project located nearby.

These achievements reflect the ongoing collaboration between CFM and Erco Energía to build a portfolio of solar projects that will expand and diversify Colombia’s renewable energy capacity. The initiative also shows how European Union public funding can reduce risk for large-scale infrastructure projects, enabling a significant amount of private investment that would otherwise be difficult to secure.

The Pétalo del Norte I project, situated between the Cesar and Norte de Santander regions, is the first project in Latin America to reach commercial operations under CFM’s investment strategy. Developed in partnership with Erco Energía and executed by Andina Solar, the plant has a capacity of 26.4 MWdc (19.9 MWac) using fixed-tilt solar photovoltaic technology. It generates more than 45 GWh of clean electricity every year, preventing approximately 13,276 tonnes of carbon emissions annually. This energy supply is enough to serve around 32,600 people. The project is connected to the grid through a 1.2-kilometre overhead line operating at 34.5 kV.

Construction of Pétalo del Norte I created 270 jobs. Local participation accounted for 64 percent of the workforce, and women represented 30 percent of those employed. CFM invested close to USD 20 million into the project through its EU-supported renewable energy infrastructure fund, Climate Investor One (CIO), covering both development and construction. The project operates under a 15-year power purchase agreement with an independent energy trader, providing long-term revenue stability.

Pétalo del Norte I also includes a Community Development Programme worth USD 125,000. Developed with input from local leaders, this programme supports four neighbouring communities: La Pedregosa, La Fragua, La Raya and Palmichal. The initiative focuses on improving education, expanding access to clean water, promoting women’s empowerment, and supporting rural businesses. It also funds upgrades to community infrastructure, youth development through sports, and initiatives that strengthen leadership and business skills. The programme is expected to benefit around 2,400 residents.

CFM has also invested USD 1.5 million in development funding from Climate Investor One to advance the Pradera solar-plus-storage project, which will be located on adjacent land. Once constructed, Pradera will provide 40 MWac of solar generation capacity and 18 MWh of battery storage, making it the largest solar-plus-storage facility in Colombia. When operational, it is expected to generate more than 95.8 GWh of clean electricity each year, avoiding approximately 129,000 tonnes of CO₂ emissions and supplying power to about 71,000 people. The project is anticipated to create roughly 380 jobs during construction and 29 permanent positions once operational. A separate community development programme will also be created in coordination with local stakeholders.

The inclusion of a Battery Energy Storage System (BESS) makes Pradera an important milestone in Colombia’s energy transition. The storage system will help balance short-term fluctuations in solar power production, reduce grid instability, and limit exposure to Colombia’s high-cost spot market during dry periods, including El Niño events. By improving consistency and predictability in energy output, Pradera will contribute to a more reliable national grid and support wider adoption of solar power across the country. Both projects are made possible by CFM’s blended finance model, which combines public and private capital to lower financial risks, reduce overall costs, and accelerate the development timeline. CFM supports projects from early development through construction and operation, avoiding the delays associated with traditional financing structures.

According to Juan Paez, Head of Latin America at Climate Fund Managers, access to capital is a major barrier to reaching Colombia’s 2050 net-zero goals. He noted that the partnership with Erco Energía, backed by the European Union, demonstrates how blended finance can help fill this gap and support projects that strengthen energy security and advance the clean energy transition. He added that the progress of Pétalo del Norte I and Pradera marks the creation of a solar platform that will contribute to sustainable growth across the country.

Alberto Menghini, Head of Cooperation at the European Union Delegation in Colombia, highlighted that the European Union is Colombia’s main partner in its energy transition. He explained that through initiatives such as the Global Gateway, the EU uses blended finance models like Climate Investor One to reduce risk and mobilise private capital. He emphasised that this approach enables impactful projects like Pétalo del Norte I and Pradera, which diversify Colombia’s energy mix, create jobs, and bring long-term benefits to local communities.

Juan Camilo López, CEO and Co-Founder of Erco Energía, stated that expanding solar power is crucial for strengthening Colombia’s energy security and resilience. He reiterated that partnerships combining local expertise with international investment can accelerate this shift while generating lasting economic and social value for surrounding communities.

Today, nearly 70 percent of Colombia’s electricity is generated from hydropower, which makes the system vulnerable to drought and climate variability. At the same time, non-conventional renewable sources such as solar and wind currently contribute less than 2 percent of total electricity generation. However, Colombia has abundant sunshine throughout the year, and investment in large-scale solar and storage projects is increasing rapidly. Developments like the Pradera project will play a central role in improving grid reliability and reducing the need for fossil fuel backup during dry seasons. Together, Pétalo del Norte I and Pradera mark important progress in Colombia’s journey towards a more reliable, diverse, and sustainable energy system.